Third-quarter profit fell 5.3 percent at Canadian Pacific Railway to $184 million, as it lost 10.1 percent of intermodal traffic from a year earlier while battling extreme weather disruptions.
CP actually took in 4.3 percent more revenue than in the 2010 quarter, to $1.32 billion. But with higher costs for purchased services, fuel and interest, the carrier’s net income slid to 13.9 percent of receipts, from a 15.3 percent profit margin a year earlier.
All year long, CP has struggled with major weather problems, starting with snowstorms and avalanches last winter and then heavy flooding in the spring and summer. As CP’s network had more difficulty rebounding from weather disruptions than rival carrier Canadian National Railway, time-sensitive intermodal shippers switched some of their business. This summer saw severe flooding on its U.S. lines as well as in Canada.
Along with a milder drop in grain carloads, that intermodal decline more than offset gains in most cargo categories and pushed CP’s overall third quarter shipment volume down 2.5 percent. CP also lost 6 percent of revenue from intermodal, its largest cargo in sales, but managed to increased total freight receipts 4.6 percent.
Fred Green, president and CEO, said “we currently see strength in our bulk franchise, but remain vigilant in monitoring economic signals from Asia."
During the quarter, revenue per shipment rose 7.3 percent across all categories, with a 21.6 percent jump in average coal receipts, a 4.6 percent gain for intermodal and 4.9 percent for automotive loads.
CP boosted its workforce 3.9 percent from the 2010 third quarter to 16,675 employees at the end of September. Green said the company is “focused on sustaining and improving service and productivity through investments in locomotives, infrastructure, people and technology."